Mining stocks witnessed a rebound in their price on Monday as the precious metals also saw an up day. Most of the time, it’s expected that the miners closely follow the metals. However, there are times that they may deviate.
In this article, we’ll look at miners’ technical details like moving averages and RSI levels. We have chosen Coeur Mining (CDE), Barrick Gold (ABX), Hecla Mining (HL), and Eldorado (EGO) for our analysis.
CDE, ABX, and HL have a YTD gain of 4.8%, 4.5%, and 2.3%, respectively. However, EGO has a YTD loss of 27%. The silver-based miner Global X Silver Miners (SIL) has a YTD gain of 6.9%.
All the four miners that we are discussing are trading above their 20-day moving average. With the exception of EGO, they are also trading above their 100-day moving average.
A considerably high premium over the 20-day and 100-day moving averages could indicate that their prices may soon fall. However, a significant discount below the 20-day and 100-day moving averages could suggest that prices may increase.
Another important indicator that we consider when analyzing whether an asset is overpriced or underpriced is the RSI level. The RSI level of CDE, ABX, HL, and EGO are 57.3, 44.9, 60.8, and 56.9, respectively. These levels have risen considerably over the past one week.
An RSI level above 70 is an indicator that the share is overpriced and may soon fall, whereas an RSI below 30 indicates that the stock is underpriced and may rapidly rise.